Mexican stocks log seventh straight win

Mexican broadcasters seen benefiting as country wins spot in 2010 World Cup

LOS ANGELES (MarketWatch) -- Mexican stocks stretched their winning streak Monday and ended at their best level this year, with finance and industrial issues leading advances as investors in the local market and on Wall Street prepared for the first big wave of corporate earnings announcements.

Mexico's IPC index climbed 1.5% to 30,475.43, marking its seventh consecutive session of advances, the longest stretch of gains since a nine-session run in early July.

Reports from the financial group in the U.S. will kick off on Wednesday with J.P. Morgan.

"As we head into the midway point of October, the heart of the U.S. earnings season will certainly assume the role of critical price-driving factor on an intraday basis for the global financial markets," wrote IDEAglobal economist Enrique Alvarez in a note to clients dated Oct. 10.

"However, the just ended week leaves us with a much greater theme ahead in terms of medium-term asset price direction and the bubble underlying current events," wrote Alvarez.

The financial group is expected to see the highest rate of earnings growth for the third quarter, at 58%, according to data from Thomson Reuters. If earnings meet expectations, it will be the first quarter of earnings growth for the financial sector since the second quarter of 2007. But several industry analysts have expressed concern about upcoming results in the sector. See full story.

On Wall Street, the S&P 500 Index
SPX, +0.35%
rose 0.4% to post its sixth win in a row. The Dow Jones Industrial Average
DJIA, +0.21%
rose 0.2% for its third win in a row.

Elsewhere in Mexico City, shares of Grupo Televisa
TV, +0.56%
rose 1.2%. Mexico this weekend secured a spot in the 2010 World Cup soccer championship games and that's important for Televisa and its rival, TV Azteca, because of an increase in ratings during the tournament, wrote Deutsche Bank analyst Miguel Garcia in a note to clients Monday.

Garcia said broadcast revenue from the airing of the World Cup in 2006 and 2002 had "a big impact" on Televisa's broadcasting revenue.

"Although it could be argued that the presence of the Mexican team is not too important because Mexicans would watch the tournament anyway, we believe that the presence of the national team engages people who normally don't watch soccer," Garcia wrote.

"Therefore, we would expect a negative impact for Televisa if Mexico didn't participate in the World Cup," said Garcia.

During the later stage of the trading session, Mexico's statistics institute said industrial output in August fell 7.3% from the year-ago period. Analysts surveyed by Dow Jones Newswires were looking for a decline of 6.3%. The contraction was led by a 10.8% decline in the manufacturing industry and a 7.8% fall in construction activity. Output in August fell 0.22% from July, said the agency which is also known as Inegi.

Industrial production on a year-over-year basis has declined every month since August 2008, according to the report.

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